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Interview: Bogdan Iordache of Underline Ventures

Our first Rest of the World interview features Bogdan Iordache, General Partner at Underline Ventures, a new fund that partners with Eastern Europe-based, globally-minded early stage startup founders. As well as being heavily involved in the Romanian investment scene, Bogdan co-founded Conectoo, an enterprise email marketing platform that exited in 2014 to Emag and co-founded How to Web, one of Europe’s largest startup events.

What brought you first to the startup world?

After graduating my studies I felt all the job ads I was reading were not for me – so I started my first business endeavour, then the second, not knowing I was doing “startups”.

And what were you doing previous to Underline Ventures?

In the past 10 years I have worked mostly in investment – at Springboard, 3TS Capital Partners, MVP Academy and then Gecad Ventures. It has been quite a ride, and I had the chance to meet and sometimes work with some amazing (mostly Romanian) investors.

At the same time, I have been part of the How to Web team and supported the company’s projects, most notably our annual conference. How to Web has been an incredible space where I had the chance to meet many amazing European funds, great founders, and many operators, and learn so much about building products, teams, and companies.

How to Web was launched in 2009, and after 13 years is probably still one of Europe’s top 5 startup conferences in terms of size and impact.

What are you looking for in startups and in founding teams?

We want to partner at the seed stage with Eastern European founders who want to build global-first companies. This includes startups where just a part of the founding team is Eastern European, and we’re happy to help them develop their Eastern European team.

As traits, we love founders who are deeply customer-centric and have the leadership skills that allow them to build great teams. We try to deeply understand the product value they are creating, and we’re less inclined to invest in companies that need to localize their products. 

We are vertical-agnostic, but there are some areas (such as consumer hardware) where we tend to be more cautious.

Why should startups choose Underline Ventures?

I’m working every day to give them plenty of reasons 🙂 

We want to be great partners to the founders we work with, and this means focusing on actual things they need support with so they can achieve their objectives, but also be a good listener whenever they want to discuss a strategic decision they need to make.

We can help hands-on with things regarding product strategy and go-to-market actions, help with communication and recruitment projects, and connect them with other great investors. We can also leverage our LP network and extended networks to help them connect with clients, experts, or potential employees. 

The fact that we’ve been in this before startups were called startups really helps.

How do you assess the startup ecosystem in Romania? We all know about UiPath, but what else is going on? Could you give us an overview?

Romania has had some great tech companies even before UiPath with RAV Antivirus, Bitdefender, eMAG to name a few. 

UiPath came out of nowhere and it was definitely a lucky accident, but an accident that has changed the local scene in many ways – there are more investors interested to invest in Romania, more know-how, and much more ambition. 

In the last few years we’ve seen a steady build-up, with new funds emerging, and new companies growing (FintechOS, DruidAI amongst them), and I’m sure we’ll see some notable successes in the next 5-10 years. I don’t think we’ll see another tech company doing a 50 billion IPO anytime soon, but I’m sure we’ll have more unicorns in the next decade.

What are the advantages and disadvantages of starting up in Romania?

It really depends on what you compare it with. As a founder, you generally do not have too much of an alternative because moving into a new country means you have to restart building your network. 

We have a strong developer base, with probably less than 20% of all developers working in product companies. We also have lower costs than the UK or US, and if you start here you can build a very strong engineering base. 

However, we don’t have too many experienced product, sales or marketing people. This has improved in the last few years, but there’s definitely room for improvement.

How would you assess CEE’s evolution when it comes to startups in the last years? And where is it heading?

There has been a steady development throughout the entire CEE in the last 10 years. If ten years ago we’d looked at the map, we’d hardly count probably 5-6 countries that had tech companies valued at more than $100m. Now, there’s almost no country in Eastern Europe without a company worth hundreds of millions, if not billions. 

I can only assume that in the next decade the impact of all those networks, smart money, know-how will help create many new successful startups. This trajectory can be negatively impacted only by geopolitical factors, and I hope it won’t be.

What startups from your portfolio are you most excited about?

We have not announced our portfolio yet, so I cannot comment on this right now.

And from your anti-portfolio you wish you had invested in? Did that change your perception about how to evaluate founders or startups?

It’s too early for an anti-portfolio, we’ve started just 6 months ago. But we’ve been in talks with some promising startups and decided not to invest because we could not get enough conviction on some elements of their business – I’m sure we’ve already been proven wrong.

What advice would you give to startup founders as Europe braces for important turbulence in the economy?

What I generally tell founders is that in every crisis the consumer mind moves its focus from expansion to efficiency – from “how can I grow” to “how can I organize better whatever I have right now”. Understand how your clients evaluate your product, and, if the case, see if you can move from the first bucket to the second one. 

And yes – have enough cash so you can have one year of visibility ahead of you, and, if possible, always have a plan on how to become cash flow positive.

What’s next for Bogdan and Underline Ventures?

Next for Bogdan is Underline Ventures – we’ve got a lot of things to do in order to build a great venture company.

What’s the best way for people to stay updated with the latest from you?

I tend to use fairly regularly LinkedIn and Twitter, so see you there!

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